5.3. Results of Analysis
Price elasticity of demand differs depending on the time passed since price change. Therefore, the analyses have to differentiate between the short-, medium- and long-term effects. Most authors define ‘short-term’ as 1 or 2 years, ‘medium-term’ as 5–7 years, and ‘long-term’ as 12–15 years (sometimes even 20) [53
]. Figures between periods may vary substantially [54
]. It is, therefore, justifiable to conduct research during different periods since price change.
A review of the findings shows that the price elasticity of demand is strongly diversified [55
]. For bus services it amounts from 0.4 in the short-term to 0.7 in the long-term [57
]. Meta-analyses conducted by [58
] show that the elasticity for vkm amounts to 1.05 in the short-term and 1.35 in the long-term.
At the initial stage of the analysis, the influence of factors other public transport services (measured in the volume of vehicle-kilometres) in a given period was eliminated. The reduction of influence of supply on demand was carried out in two cases (commune of Kolbudy and Pruszcz Gdański city) where the volume of vkm increased from 2017 to 2018 by 35% and 10%, respectively. In the remaining cases, the change in vkm was treated as an insignificant variable—the analyses of data gathered in previous years in the examined cities and communes did not point to a conclusive relationship between the change in vkm and number of passengers, where the vkm grew by less than 5% within the public transport network of a given commune.
In one case (Kolbudy commune), data obtained from research within the GBM allowed for an empirical elimination of the influence of the increase of vkm on demand since the research was conducted on a cross-section of particular operating lines. The data was reduced by demand generated by two newly established lines (the demand within this commune increased by 82.2% after establishing two new connections in connection with the opening of a new school). In the case of another commune (increase of vkm by 10%) an elasticity of 0.85 was assumed on the basis of data from previous research.
presents the comparison of the results of the analysis into changes in demand within the examined cities. Reference [58
] points out that the published analyses of price elasticity of demand in connection with public transport may be ‘partial’. Frequently there are rising doubts that only research with desired (or at least pointing in the desired direction) and significant findings are published. This article presents the results of analyses which are not always in accordance with the general models of price elasticity of demand. Instead of dismissing them, the authors decided to empirically explain them, pointing to the necessity of an individual approach to the examined issue and adding to the current knowledge of elasticity and effects of FFPT implementation.
The data presented in Table 2
points to the vastly diversified effects of new FFPT entitlements in the cross section of particular cities/communes. The following numbers of passengers were taken into account during the process of conducting analyses: overall number and number in two segments (analysed together) where demand shift took place—the segment of those entitled to reductions and free fares.
The demand in Kolbudy commune increased overall by 17.8%, and in the segment of passengers travelling on reduced and free fares only by 7.6%. Paradoxically, the extension of FFPT entitlement generated a larger demand among passengers who were required to travel on full price fares than in the segments of passengers which were analysed together and experienced demand shift (those travelling on reduced or free fares). This phenomenon can be explained if we take into account the particular circumstances in relation public transport in that commune. The opening of a new school (Zespół Szkół Metropolitalnych—Municipal School Complex) generated new demand also on lines which were not dedicated to the new school (note: demand for services of the two newly opened lines was removed from the analysis). The higher percentage growth of overall demand for public transport services in comparison with the reduced-free segment can be explained by the generated new source of movement demand (school) also on the lines which were already in operation (parents taking children to school on those routes, directly and with interchanges, as well as teachers and school employees travelling to their new workplace). The analysis points to the fact that despite the carried out reduction of the influence of public transport services supply increase within the Kolbudy commune, the force of influence of the new source of movement (school) on the pre-existing network prevents conclusive interpretation of price elasticity of demand in this commune.
The second commune named in Table 2
(Pruszcz Gd. commune) may be treated as a reference point for conclusions drawn from the analyses. The entitlement to free fares remained unchanged in this commune. Year on year (2018/2017) the volume of passengers decreased by 17%, 23.3% in the reduced-fare-free segment. In the previous two years, the demand in that commune also manifested a downward trend (in the years 2018/2017, 9% and 6%, respectively). Introduction of FFPT in neighbouring communes may have caused a faster drop in passenger volumes from which a group of passengers (students) began to travel on the lines where FFPT was accepted and which travelled via the Pruszcz Gdański commune area. This was confirmed indirectly in another research carried out within the GBM in the same commune in 2019 (the research was carried out by the Metropolitan Public Transport Association of Gdansk Bay (MZKZG), the results were forwarded to local authorities and public transport organisers). In conclusion, it cannot be clearly stated to what extent in Kolbudy commune the 17.8% increase in demand was generated by a new source of traffic and to what extent by free fare.
A total increase of 2.5% in the overall passenger volume was noted in the city of Pruszcz Gdański, and in the segment of reduced-fare-free the demand grew by 9.9%. The price elasticity of demand amounted to −0.045 and −0.099, respectively, making it considerably lower than in similar research carried out among British youth [59
Sopot is the only city located within the core of the metropolis that was examined as part of the analysis. After the extension of fare-free entitlement, the overall passenger volume decreased by 1.4%, 2.2% of which was in the reduced-fare-free segment. In the same city the demand in the previous two years declined by 9.1% and 3.5%. This means that the extension of fare-free entitlements stopped the decline in the overall passenger volume; however, it did not manage to reverse it. Worse still, the passenger volume downward slide was not beaten within the segment of reduced-fare-free, namely, the main beneficiaries of FFPT implementation.
A similar scenario was seen in the rural commune of Żukowo. The overall number of passengers decreased annually by 11.3%, of which 12.4% was within the reduced-fare-free segment (main beneficiaries of the free fare), the consequence of which was positive elasticity. It should be added that following the extension of fare-free entitlement the overall passenger volume within the commune began to drop at a much faster rate than in the previous year (by 9.4%). The 6.4% increase in vkm introduced on one of the lines was unable to reverse that trend.
In the commune of Kosakowo, the overall number of passengers increased by 6.5%, of which 29% was within the reduced-fare-free segment. The situation of this particular commune is special as their authorities managed to negotiate the inclusion of free fare on the lines connecting Kosakowo with Gdynia (the second largest city within the metropolis). On the basis of this agreement students living in Kosakowo could travel for free to Gdynia and around Gdynia. This fact strongly influenced the increase in mobility of students living in Kosakowo also during travel which was not connected with education (past-time activities, recreation, cultural events, shopping). The increase of the overall volume of passengers is partly owing to a growing trend in passenger volumes that has been present in this commune for a number of years. On average, since 2014, the number of passengers has grown by 1.7%, which is also a result of the increase in population by 5% on average since that same year. The second factor of superior importance, which is reflected in data presented in Table 3
, pointing to the overall increase in revenues from the sale of fares within the commune of Kosakowo, is the result of an increasing number of passengers which are required to purchase full price tickets. Owing to the fact that due to the lack of data it is impossible to calculate the influence of the abovementioned variables on demand, the data regarding the effect of FFPT implementation in the commune of Kosakowo should be treated with caution.
Rumia, the third city examined, noted an increase in the overall passenger volume of 3.9%, of which 6.9% was within the reduced-fare-free segment (main beneficiaries of FFPT introduction). Price elasticity of demand amounted to −0.070 and −0.069, respectively.
The final examined commune of Szemud noted an increase in demand of 0.5% and 0.9%, respectively, with elasticity of demand amounting to −0.010 and −0.009.
presents the financial consequences connected with the extension of FFPT entitlement for the communes where, other than price, factors were not recognised as having significant influence on demand. The data points to the conclusion that the introduction of FFPT was connected with a decrease of 13%–27% in revenues from fare sales in four cities and communes.
presents calculations comparing the change in demand following the extension of FFPT entitlements and a possible, achievable shift of that parameter, with an assumption that the increase in vkm would be covered by assets allocated for the entitlement extension (a relatively low indicator of supply elasticity of demand was adopted, evkm
= 0.65, together with the average cost of vkm in a given commune).
The analysis of data presented in Table 4
shows conclusively that in all cases but one the assets designated for FFPT entitlements extension would provide a better result (understood as positive changes in the demand), should they be allocated for the purchase of additional vkm.
Moreover, marketing research is carried out every two years on the travel preferences and behaviour of the inhabitants in the area analysed. During the research, respondents are asked about the most important features of public transport for them. A recent study found that the most important for the inhabitants of the studied area is the frequency (17.7% of responses), punctuality (16.2% of responses) and directness (15.1% of responses) of public transport [60
]. The cost of travel by public transport was indicated as significant when making transport decisions by 9.8% of the respondents. Therefore, these studies confirm that for the inhabitants of the metropolitan area, the quality of public transport is more important than the price of tickets. During the same research, the respondents indicated the most important reasons for using public transport, despite having a passenger car. These reasons included: difficulties in finding a free parking space, parking fees and road congestion. The main reasons why the residents travel by passenger cars were: greater comfort, shorter travel time by car and transportation of goods or purchases. This means that the FFPT concept does not meet the most important expectations regarding public transport. This statement is in line with [61
]. The conclusion of this study is that the introduction of FFPT is not enough to produce a modal swift from private car to public transport.